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ThyssenKrupp steelworkers seal job security deal ahead of Tata merger

Steelworkers at German industrial giant ThyssenKrupp have won guarantees that their jobs are secure until 2026, bringing the group a step closer to its planned merger with India's Tata Steel.

Published: 22 December 2017 11:16 CET

ThyssenKrupp steelworkers seal job security deal ahead of Tata merger

Thyssenkrupp employees at a plant in Duisburg. Photo: DPA.

ThyssenKrupp said late Thursday it had clinched a deal with Germany's powerful IG Metall union pledging there would be no job losses or major site closures until September 2026.

“The outcome achieved today represents a key prerequisite for meeting our strategic objectives and at the same time satisfying the interests of our employees,” ThyssenKrupp CEO Heinrich Hiesinger said in a statement.

The agreement, which still needs to be approved by union members, clears a major hurdle for the conglomerate as it seeks to combine its steel operations with Tata to create Europe's second biggest steelmaker after ArcelorMittal.

ThyssenKrupp and Tata say the tie-up is necessary to combat chronic overcapacity in an industry roiled by a flood of subsidized Chinese steel.

While the merger will allow for economies of scale and other savings, the firms have warned it will also lead to some 4,000 job cuts that will be shared roughly evenly between the two groups.

ThyssenKrupp, which makes products ranging from car parts to elevators to submarines, has said it is not planning any forced redundancies.

Turning to its German steel works, it said “the future of the majority” of the sites was assured for the next nine years under the deal.

But the group said it would only guarantee operations for the sites in Bochum, Eichen and Huettenheim in western Germany until 2021.

ThyssenKrupp also promised to invest “at least” €400 million ($470 million) a year in its German steel works and retain the voting rights of German workers' representatives on the new supervisory board.

The merged holding company, to go by the name Thyssenkrupp Tata Steel, will be headquartered in the Netherlands.

It will have combined annual sales of some €15 billion euros and employ 48,000 people across 34 sites.

The tie-up should be completed by the end of 2018, added the German group.

Five things to know about salaries in Germany

If you are moving to Germany, you might soon start looking for a job in the country. However, like many other aspects of living abroad, there are several cultural differences and specificities when it comes to job hunting in Germany – especially when it comes to salaries.

Here are five things to know about salaries in Germany.

There is a minimum wage in Germany

Germany’s minimum wage of €12.41 per hour, pre-tax came into effect at the start of this year. This amounts to a monthly salary of €2,054 which ranks ninth in the world. The minimum wage will rise again in 2025 to €12.82 per hour before tax deductions.

There have been calls recently to hike the salary up higher to €14 per hour.

READ ALSO: Millions of workers in Germany ‘earning less than €14 per hour’

Find out salary expectations

Germany does not require companies to list salary ranges for listed positions. But that may be changing soon. The EU parliament passed a wage transparency law to require companies to publish annual reports detailing wage and wage discrepancy information. The rules, which are set to go into effect in 2027, are intended to help close the gender pay gap.

In the meantime, employees can utilise online resources to find industry averages and expectations for different roles:

Gehalt.de offers users access to salary information on more than 800 professions
Online platform, Kununu provides compensation information and employer reviews to users in the DACH region
Berlin residents can utilise REDSOFA’s salary survey for an overview of salary averages in the country’s capital city

As of April 2023 the average gross monthly salary was €4,323 according to Germany’s Federal Statistical Office.

Two-thirds of full time workers make less than this average monthly salary and one-third of workers earn more than this average monthly salary.

While wages after deductions may be less than similar roles in other countries, it is also important to take into consideration what other benefits come with a salary. Paid holiday leave, pension contributions, long notice periods and annual bonuses can help make up some of that difference.

READ ALSO: How much do employees in Germany typically earn?

Check your payment schedule

Internationals can usually expect their salary once a month when working in Germany. Many German companies choose to pay employees either on the 1st or 15th of the month. It is also important to note that most employees can expect to receive their first pay check within 30 or 45 days of starting.

For positions that offer yearly bonuses, these payments are included in a 13th pay check which are subject to income tax.

A person works on a laptop.

A person works on a laptop. Image by Bartek Zakrzewski from Pixabay

How many hours do you work?

When looking for a job, don’t forget to check how many hours you can expect. Job descriptions will include expectations for time commitments.

Mini-jobs, as expected from the name, are limited in hours and pay. Employees can expect up to €538 per month. Mini-jobs do not provide social security because they do not require social security contributions. Employees are also not automatically covered by health and nursing care insurance.

Teilzeit, or part time jobs, are defined as any job where working hours are less than a full time position.

A common misconception is that part-time work requires working 20 hours or less a week. But an employee working five days a week for 30 hours, at a position that is typically 40 hours when full time can also be defined as a part time worker.

READ ALSO: The rules in Germany around ‘mini’ and ‘midi jobs’

In fact, Germany has a term for workers who work between 28 and 36 hours a week. Vollzeitnahe Teilzeit, or nearly full time part time workers, can be a popular choice for some people, including parents. These positions can give employees more flexibility to balance work and family responsibilities. It is important to note that these workers are paid according to their time worked, so it will still amount to less than full time.

Depending on the work schedule, part time employees can earn the same amount of vacation as their full-time counterparts. That’s because holiday leave is calculated based on days worked, not hours. If a part time worker comes in five days a week, they will be eligible for at least 20 days of holiday. If that same part time worker comes in three days a week, they will be legally entitled to twelve days of vacation, even if they worked the same hours as the other employee.

In most companies, weekly working hours between 35 and 40 hours are considered full-time employment or Vollzeitbeschäftigung.

Watch out for the gross v. net difference

Before you sign the dotted line, it will be important to check how much of your gross salary you’ll be able to keep come pay day. Companies that include salary expectations in descriptions include gross salary (Bruttoeinkommen) – not the net income after taxes and deductions (Nettoeinkommen). The amount deducted will depend on how much you earn, the tax class you’re in and on other factors such as how much you’re paying for healthcare but it is usually around 40 percent.

Salaried employees can find information on the deductions on their pay slip. Some to expect to see include:

Taxes are deducted directly from the gross pay. The amount is based on the tax bracket your salary falls within
A percentage of your gross salary is also deducted for your pension / retirement contributions
Church taxes between eight and nine percent of your salary will also be due if you are affiliated with a religion
Unemployment insurance amounts to a 2.5 percent deduction from your gross salary. It is important to note that the insurance covers a salary up to €90,600
Health insurance contribution rates are typically split between employers and employees. The rate depends on the provider. In 2024, the TK contribution rate to health insurance is 15.8 percent of the gross income

READ ALSO: What you need to know about your payslip in Germany

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